The overall purpose of this study is to determine the impact of depression on insulin resistance (IR) in diabetes. IR characterizes type 2 diabetes (T2DM) and is a predictor of diabetes complications, particularly coronary heart disease (CHD). CHD, in turn, accounts for more than 50% of deaths and 75% of hospitalizations among diabetic patients. Because of this, potentially modifiable factors contributing to IR are being sought. There is evidence linking IR to depression in nondiabetic subjects, and IR may improve with depression treatment in these subjects. Depression is present in approximately 20% of patients with type 2 diabetes (T2DM), precedes the onset of diabetes diagnosis by more than 5 years on average, and may be responsible for some of the IR typifying T2DM and its CHD risk. In a 10-year prospective study of diabetic women with and without depression, we found that depression accelerated the development of (p <0.01) and increased the risk for CHD (OR 3.1, 95%CI 1.1-8.9) and was retained as an independent predictor of CHD in multivariate analysis. In the proposed study, we plan to recruit 160 untreated subjects with a provisional diagnosis of T2DM, 80 with and 80 without major depression (per DSM-IV) matched for gender and BMI. IR (from oral glucose tolerance tests), as well as measures of mood, glycemic control, HPA-axis activity, central adiposity, diet, and physical activity, will be determined at baseline for all subjects. Depressed subjects also will undergo frequently sampled intravenous glucose tolerance tests (FSIGTT) and more detailed analyses of activity, adiposity, and intramyocellular fat. Depressed subjects will be randomly assigned to 12 weeks of cognitive behavior therapy or usual depression care; nondepressed subjects will be observed for comparison. All baseline measures (including FSIGTT and the additional tests in the initially-depressed) will be repeated alter intervention/observation. Univariate tests, analyses of covariance, and least squares regression techniques will be used to assess the independent effects of depression and change in the severity of depression symptoms on IR and change in IR over time. The effect of depression treatment and of depression remission on IR (controlling for baseline differences) and potential mediators of a depression-IR relationship also will be determined in the initially depressed subjects. We hypothesize that depression is associated with increased IR in untreated T2DM and that IR improves with successful depression treatment. The findings from this study could identify a potentially modifiable factor for improving the course and outcome of those living with T2DM.